The US Securities and Exchange Commission follows up on the guidelines for cryptocurrency staff issued by the Commodity Futures Trading Commission
After the procedural termination of debates and voting on the CLARITY Act failed, the U.S. Securities and Exchange Commission (SEC) announced an update to its guidelines regarding how federal securities laws may apply to token issuers. Previously, the CFTC (Commodity Futures Trading Commission) had also issued similar guidance.
The U.S. Securities and Exchange Commission updated its policies regarding how securities laws will apply to "certain types of crypto assets and certain transactions involving crypto assets," following a similar move by the U.S. federal commodities regulator last week.
In the update to the frequently asked questions (FAQs) regarding SEC released in March on Friday, the institution stated that the latest interpretations of cryptocurrency regulations are not binding, “do not have legal effect, [will not] change or amend the applicable laws, nor [will they] create any new or additional obligations for anyone.” These FAQs will apply to how SEC views digital asset products that meet the ‘investment contract’ standards outlined in the Howey Test (Howey test).
SEC indicates that as long as 'a certain encryption system has the necessary functions and there is no centralized entity involved', the token issuer can carry out a buyback program for customers, and this 'does not necessarily constitute an indication of making or promising to make key management efforts'. In other words, under the federal securities laws, it may not necessarily be considered an investment contract.
Regulatory authorities have also issued similar guidelines regarding encrypted networks, stating that if a system already “has functionality and provides services to ensure, maintain, improve, or enhance that system or its functionality, or to facilitate network effects,” it may not necessarily meet the authorities’ Howey test criteria. The authorities also indicated that staked token certificates ( staking receipt tokens ) are not always classified as securities either.
The update from SEC comes shortly after similar actions taken by the U.S. Commodity Futures Trading Commission, which previously provided guidelines for token issuers. Both agencies issued these responses within days of the Senate's failure to pass a bill on the structure of the crypto market. Many had expected that this bill would clarify the respective responsibilities of these two financial regulatory agencies in the field of digital assets. The chairpersons of SEC, Paul Atkins ( Paul Atkins ), and CFTC, Michael Selig ( Michael Selig ), both issued statements indicating that the agencies will proceed with crypto regulation efforts in the absence of relevant legislation passed by Congress.
SEC will leave the institution this week.
After serving in SEC for 8 years, Commissioner Hester Pierce ( Hester Peirce ) announced on Friday that she plans to resign on October 2nd. This official, known by many in the industry as the "Crypto Mom" ( Crypto Mom ) for her support of policies beneficial to digital assets, is reportedly set to join the Law School of Regent University in Virginia ( Regent University ) as an associate professor in November.
With Pierce's resignation, the leadership of this financial regulatory agency will consist only of Atkins and Commissioner Mark Uyeda ( Mark Uyeda ). Both are Republican members of the bipartisan committee, which usually consists of five members. As of Monday, U.S. President Donald Trump has not announced a successor for Pierce, nor has he named potential candidates for the remaining two Democratic seats ( SEC ).
